Posted on | June 7, 2012 | No Comments
US futures pointed to a higher open on Wall Street, with the NASDAQ 100 spread betting index, S&P 500 and Dow all up between 0.5% and 0.7%.
Meanwhile, the FTSE 100 was trading at 5455, representing a rise of 1.31% at 12.08pm (London time).
On the economic front, spread betting investors await the release of weekly initial jobless claims at 1.30pm (London time).
This is expected to fall to 378,000 for the week ending 2 June from 383,000 previously.
Investors also await Federal Reserve chairman Ben Bernanke’s speech as to how the Fed observes the current US economy.
Investors will be looking for clues regarding additional QE, particularly after the poor jobs report for May and other weak economic data around the world.
If the Fed disappoints then the recent gains seen in the stock markets could quickly evaporate.
Meanwhile, China’s central bank, in a surprise move, cut benchmark interest rates by 25 basis points for the first time since 2008 to combat slowing economic growth.
The People’s Bank of China said that the one-year lending rate will fall to 6.31% from the current 6.56%, while the one-year deposit rate will drop to 3.25% from 3.5% effective 8 June.
Most analysts were not expecting the central bank to bring any outright cut in interest rates in 2012, but instead were expecting a cut in the required reserve ratio (RRR) to boost money supply growth.
By Chris Beauchamp, Market Analyst, IG Index.
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